2019 BCSC 57 Scheck v. Parkdale Place Housing Society

IN THE SUPREME COURT OF BRITISH COLUMBIA

Citation:	Scheck v. Parkdale Place Housing Society,
	2019 BCSC 57

Date: 20190118

Docket: 12828

Registry: Rossland

Between:

Muriel Winona Scheck

Plaintiff

And:

Parkdale Place Housing Society and
The Corporation of the District of Summerland

Defendants

Before: The Honourable Mr. Justice Johnston

Reasons for Judgment

(On Costs)

(In Chambers)

Counsel for the Plaintiff:	J.T.E. Gelber
Counsel for the Defendant: Parkdale Place Housing Society	L.A. Wright
Counsel for the Defendant: The Corporation of the District of Summerland	J.J. Krusell
Place and Date of Hearing:	Rossland, B.C. October 30, 2018
Place and Date of Judgment:	Rossland, B.C. January 18, 2019

[1] Ms. Scheck’s claims against Parkdale Place Housing Society (“Parkdale”) were dismissed for reasons set out in Scheck v. Parkdale Place Housing Society, 2018 BCSC 938. Parkdale now seeks its costs of the action. Parkdale also asserts that it made an offer of settlement that complied with Rule 9-1 of the Supreme Court Civil Rules, and asks the court to exercise the discretion given in Rule 9-1(5) to order double costs from February 9, 2017, the date the offer was made.

[2] Parkdale says that it succeeded in the action and is presumptively entitled to have its costs under Rule 14-1 (9):

Subject to subrule (12), costs of a proceeding must be awarded to the successful party unless the court otherwise orders.

[3] Parkdale argues that this creates a strong presumption in its favour, citing Wingrave v. Pure Painters Inc., 2018 BCSC 166 at para. 2 (Chambers), and that Ms. Scheck bears the burden of establishing that the presumption in Parkdale’s favour should not govern, citing Grassi v. WIC Radio Ltd., 2001 BCCA 376.

[4] Ms. Scheck, on the other hand, argues that costs should not be ordered, or that each party should be ordered to bear their own costs, because when she brought her action, and until her claim was dismissed as against Parkdale, the state of the law in British Columbia favoured her claim against Parkdale. She relies on Reidy v. Kamloops Hotel Ltd. (1997), 41 B.C.L.R. (3d) 338 (S.C.), as she did at the summary trial. Ms. Scheck argues that she was understandably surprised that the initial judgment in this action (2018 BCSC 938) held Reidy to be wrongly decided per incuriam. She also refers to decisions and reference materials that accepted the reasoning in Reidy prior to that holding in this action. Ms. Scheck argues that she reasonably relied on Reidy, and it would be unfair to require her to pay costs as a result.

[5] Ms. Scheck also argues that by rejecting Reidy, this Court has given these proceedings an importance which extends beyond the parties’ immediate interests, and therefore the parties should bear their own costs in accordance with MacDonald v. University of British Columbia, 2004 BCSC 412 (at para. 13).

[6] In separate reasons, 2019 BCSC 48, I have found Summerland liable for Ms. Scheck’s injuries.

[7] I will deal first with Parkdale’s application for double costs.

[8] Rule 9-1(5)(b) and (d) provide:

(5) In a proceeding in which an offer to settle has been made, the court may do one or more of the following:

(b) award double costs of all or some of the steps taken in the proceeding after the date of delivery or service of the offer to settle;

…

(d) if the offer was made by a defendant and the judgment awarded to the plaintiff was no greater than the amount of the offer to settle, award to the defendant the defendant's costs in respect of all or some of the steps taken in the proceeding after the date of delivery or service of the offer to settle.

[9] Rule 9-1(6) sets out factors that a court faced with an application for double costs may, not must, consider:

(6) In making an order under subrule (5), the court may consider the following:

(a) whether the offer to settle was one that ought reasonably to have been accepted, either on the date that the offer to settle was delivered or served or on any later date;

(b) the relationship between the terms of settlement offered and the final judgment of the court;

(d) any other factor the court considers appropriate.

[10] Parkdale’s application is based upon an offer to settle set out in a letter from its counsel to plaintiff’s counsel dated February 9, 2017. The letter appears to continue an argument between counsel based on the authorities, and contains this passage:

Notwithstanding this, Parkdale is prepared to offer Ms. Scheck $1,500, inclusive of costs, to settle the action. In return, Ms. Scheck would provide a Consent Dismissal of the action and a Release of all claims against Parkdale.

The defendant, Parkdale Place Housing Society, reserves the right to bring this offer to the attention of the court for consideration in relation to costs after the court has pronounced judgment on all other issues in this proceeding.

This offer remains available for acceptance until 4:00 p.m. on March 10, 2017. I look forward to your reply.

[Emphasis in original.]

[11] The first factor, whether the offer was one “that ought reasonably to have been accepted,” is not determined by comparing the offer with the resulting award. See Hartshorne v. Hartshorne, 2011 BCCA 29 at para. 27, where the court says:

Rather, in considering that factor, the court must determine whether, at the time that the offer was open for acceptance, it would have been reasonable for it to have been accepted: Bailey v. Jang, 2008 BCSC 1372, 90 B.C.L.R. (4th) 125 at para. 24; A.E. v. D.W.J. at para. 55. As was said in A.E. v. D.W.J., “The reasonableness of the plaintiff’s decision not to accept the offer to settle must be assessed without reference to the court’s decision” (para. 55). Instead, the reasonableness is to be assessed by considering such factors as the timing of the offer, whether it had some relationship to the claim (as opposed to simply being a “nuisance offer”), whether it could be easily evaluated, and whether some rationale for the offer was provided. We do not intend this to be a comprehensive list, nor do we suggest that each of these factors will necessarily be relevant in a given case.

[12] When the offer was made in this case, I gather discoveries had not yet occurred. Ms. Scheck swears that she broke both her arms when she fell, and was hospitalized for two and a half months as a result. The offer, which included costs to that point, was no more than a nuisance offer, given the amount offered compared to the loss suffered, and the short duration of the offer itself.

[13] Under the second Rule 9-1(6) factor, the offer can be compared with the trial result, and in this case hindsight suggests that the nuisance offer should have been accepted.

[14] Under the third factor, I have no evidence of the financial circumstances of either party and decline to draw inferences. This factor is neutral.

[15] Under the final factor, Ms. Scheck was relying on long-standing case authority in Reidy, and it was not unreasonable for her to have done so.

[16] In all the circumstances, Parkdale’s application for double costs is refused.

[17] As to costs generally, I do not agree that Ms. Scheck ought to be treated in the same way as a public interest litigant for costs purposes. She had every right to pursue her claim for damages, but it was her personal claim, and not one in which the larger public has any real interest.

[18] I do not find anything in this case to displace the presumption that Parkdale, as the successful litigant in this aspect of the action, should have its costs of its successful defence of the claims against it.

[19] The parties have understandably not addressed the considerations that might arise as a result of the contemporaneous decision in which Summerland is held liable for Ms. Scheck’s injuries. While it is unfortunate that this litigation is proceeding in slices, it is unavoidable that the question of who should bear the final burden of Parkdale’s costs must be adjourned.

“The Honourable Mr. Justice Johnston”